Fubon Financial Holding Co (富邦金控) yesterday said it had won approval from the Financial Supervisory Commission to raise as much as NT$7.3 billion (US$225 million) by selling its second real estate investment trust (REIT), the company said in a statement.
Fubon Financial announced plans for the second trust in October, saying it will use proceeds from the sale to buy three commercial buildings in Taipei.
The company estimated the trust would offer annual returns as high as 4.5 percent, which compared favorably with the 1.85 percent yield on benchmark 10-year government bonds maturing in September 2015, according to GRETAI Securities Market, the nation's biggest exchange for bonds.
Taiwan Ratings Corp (中華信評) yesterday revised its preliminary long and short-term corporate credit ratings to twA+/twA-1 from twA/twA-2, with a stable outlook.
In a statement released yesterday, Taiwan Ratings said that Fubon's second REIT enjoys strengths such as good asset quality, an above-average tenant mix, moderately conservative financial policy and strong links with other Fubon group members.
Property trusts distribute rental income from buildings such as offices, hotels and hospitals to shareholders as dividends.
Fubon Securities Co (富邦證券), the Fubon group's brokerage arm, last year raised NT$5.83 billion in Taiwan's first REIT.
Shares of its Fubon No. 1 REIT rose as much as 7 percent on its March 10 trading debut as investors bet on growth in the domestic property market. They have underperformed since, however, gaining 0.1 percent compared with a 4.3 percent advance on the benchmark TAIEX.
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